A monopolistically competitive firm maximizes profit in the short run by producing where Oprice is less than marginal revenue. O price is less than marginal cost. O price is greater than marginal cost. O price is less than average revenue.

A monopolistically competitive firm maximizes profit in the short run by producing where Oprice is less than marginal revenue. O price is less than marginal cost. O price is greater than marginal cost. O price is less than average revenue.

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter10: Monopolistic Competition And Oligopoly

Section: Chapter Questions

Problem 1.1P

See similar textbooks

Related questions

Q: FIGURE 10-1 Price O MC ATC AVC MR Quantity The profit-maximizing firm illustrated in Figure 10-1…

A: Profit maximization is the process by which a company aims to increase its earnings to the highest…

Q: In the short-run this profit-maximizing firm in monopolistic competition would price at: Supporting…

A: A market with very minimal competition is referred to as a monopolistic market. It does not imply a…

Q: Which of the following is a characteristic of monopolistic competition? few sellers homogeneous…

A: There are different market structures, oligopoly, monopoly, monopolistic competition and perfect…

Q: graph shows the demand curve, marginal revenue curve, and curves of Bob's Best Burgers, a firm in…

A: In order to maximise profit, a monopolistically competitive firm creates goods at the intersection…

Q: Price or Cost 0 Price or Cost O Firm A O Firm B O Firm C Firm A O Firm D MR Quantity Firm C MR…

A: A market with very minimal competition is referred to as a monopolistic market. It does not imply a…

Q: Quantity sold is lowest in a(n) market. O monopolistic competitive O oligopolistic O competitive O…

A: The output depends on the competitiveness of the market. The competition is less in monopoly in all…

Q: A monopolistically competitive firm produces where while a perfectly competitive firm produces where…

A: Monopolistic firm and perfect competition firm are same in the sense that they have large number…

Q: The total cost (TC) of a monopolistic firm is a linear function of output (q), expressed as TC=20q.…

A: Given, TC = 20q p = 100 - 2q

Q: A monopolistically competitive firm can earn positive profit both in the short run and in the long…

A: A monopolistically competitive market has many firms producing competition with each other. Each…

Q: Suppose a firm operating in a market characterized as monopolistic competition is making positive…

A: Monopolistic competition refers to the competition wherein there are large numbers of firms…

Q: The profit-maximizing firm illustrated in Figure operates in a monopolistically competitive…

A: Profit maximization is the process by which a company aims to increase its earnings to the highest…

Q: cost represented by MC = 3 + 2Q. The firm faces the demand curve P = 99- 2Q. What do we expect to…

A: Option (3).

Q: Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive…

A: The monopolistic competition has many firms that sell differentiated products in the market. These…

Q: Advertising by firms in monopolistic competition O a. does not occur. O b. wastes resources because…

A: Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: $100 $90 MC АТС $80 $70 $60 $50 $40 $30 Demand = P $20 $10 MR $0 10 20 30 40 50 60 Output (Q) The…

A: When talking about Monopolistic firm, it shares some features of monopoly firm because it sets the…

Q: Which of the following is true for a monopolistically competitive industry? * O There are many…

A: Monopolistic firm: It refers to a firm under which goods and services are produced by many…

Q: In what way(s) is a monopolistically competitive firm inefficient? Group of answer choices It…

A: The question is asking about the inefficiencies that are associated with a monopolistically…

Q: Compared with a perfectly competitive market, a monopolistically competitive firm's demand curve is…

A: A Monopolistic competitive market has different pricing policy from a perfectly competitive market…

Q: Quantity This monopolist's profit-maximizing output level is on the x-axis.] It will charge a price…

A: Monopolistic competitive market:In this market, there are large numbers of buyers and sellers. They…

Q: In the long run, the economic profit for a monopolistic competi Negative we cannot tell Positive…

A: Monopolistic competition is a market structure characterized by many firms producing similar but…

Q: Assume you see the graph of a monopolistically competitive firm. In the graph, at the output where…

A: A monopolistically competitive firm has many sellers and sells similar but differentiated goods.…

Q: The graph depicts a monopolistically competitive firm. Dollars ($) 90 80 65 55 50 MC 0 ATC MR 10 20…

A: In monopolistic competition, There exists a large number of buyers and sellers. The firm will…

Q: if a monopolistic firm takes over a perfectly competaive market we would expect to see market price…

A: Features of perfect competition 1) large number of buyers and sellers selling homogenous goods 2)…

Q: A monopolistically competitive firm in a long-run equilibrium will likely produce which of the…

A: A monopolistically competitive firm in a long run equilibrium will likely produce less than a…

Q: The figure below depicts a monopolistically competitive firm operating in the short run. Label the…

A: A monopolistically competitive market has a large number of firms selling differentiated products.…

Q: Select the FALSE statement about monopolistic competition O Products are differentiatied There are…

A: A Monopolistic market has some specfiic features that make sit different from other competitive…

Q: ically competitive firm faces the following demand curve for its product: ice ($) uantity 10 9. 5.…

A: Monopolistic competitors produce up to MR> MC. That is, the additional revenue generated by the…

Q: PRICE (Dellare per engine) 100 233RR2. 60 20 10 MO MR 0 10 20 30 40 ATC Demand 50 60 70 DO 90 100…

A: A monopolistic competitive firm produces at the intersection of MR and MC curves. Hence,…

Q: A monopolistically competitive firm maximizes profits when it احتراحة العبارات a. produces the…

A: Monopolistic competition is a kind of market structure in which there are numerous sellers offering…

Q: Price OF EQCBA T.L H,U N H, G M MC MR HIJK Quantity Consider the monopolistically competitive firm…

A: The monopolistic competition has many firms that sell differentiated products in the market. These…

Q: 1Price MC 160 140 ATC 123.33 Demand 90 56.67 MR 100 133.33 15492 Quantity f the above firm chose to…

A: The monopolistically competitive market is a mixture of monopoly market and perfectly competitive…

Q: $80 : of $70 $60 3D $50 $40 3D $30 Demand = P $20 $10 MR $0 10 20 30 40 50 60 Output (Q) The firm…

A: There is mark up in monopolistic competition because zero profit condition ensures that P=ATC as it…

Question

A monopolistically competitive firm maximizes profit in the short run by producing
where
Oprice is less than marginal revenue.
O price is less than marginal cost.
O price is greater than marginal cost.
O price is less than average revenue.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Need help with both
Quantity sold is lowest in a(n) market. O monopolistic competitive O oligopolistic O competitive O monopolistic
A monopolistically competitive firm can earn positive profit both in the short run and in the long run as its product is different from its competitors'. O True False
Please give type answer
Study Tools ins ess Tips ss Tips PRICE (Dellars per engine) 288 RSS #RR 100 50 30 20 10 MO 0 0 10 ATC MR Demand 20 30 40 50 70 DO 90 QUANTITY (Thousands of engines) 100 Mon Comp Outcome Min Unt Cost Decause this market is a monopolistically competitive market, you can tell that it is in long-run equilibrum by the fact that optimal quantity. Furthermore, a monopolistically competitive firm's average total cost in long-run equilibrium is average total cost. at the the minimum
Help plz
$100 $90 MC АТС $80 $70 $60 $50 $40 $30 Demand = P $20 $10 MR $0 10 20 30 40 50 60 Output (Q) The firm shown in the diagram above is in long run equilibrium in a monopolistically competitive market. According to the graph, the Markup is Select one: а. $50 O b. $30 O c. $40 O d. $60
Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next, place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost. PRICE (Dolars per kit) 100 8 80 70 50 8 10 0 MO 10 ATC 20 30 O True O False MR 60 70 QUANTITY (Thousands of kits) Demand 40 80 90 100 Mon Comp Outcome Min Unit Cost Because this market is monopolistically competitive, you can tell that it is in long-run equilibrium by the fact that firm. Further, a monopolistically competitive firm's average total cost in long-run equilibrium is True or False: This indicates that there is excess capacity in the market for kits. at the optimal quantity for each the minimum average total cost.
QUESTION 18 Refer to the graph below for a monopolistically competitive firm. Price MC 160 140 ATC 123.33 Demand 90 56.67 MR 100 133.33 154.92 Quantity If the above firm chose to produce at 100 units then the firm will be O earning a profit O incurring a loss O there is no profit and no loss O the firm can earn, profit, loss or break even
Marketers spend millions of dollars annually trying to create or reinforce brand loyalty. Brand loyalty changes the demand curve for the firm's products by shifting the market from a monopoly to pure competition. O decreasing the price elasticity of demand. O reducing fixed costs and increasing the gray marketing effect. O increasing the income effect. O making demand more oligopolistic and less monopolistic.
9 of 15 Warwick Inc. produces in a monopolistically compettive market. Which of the following corectly explains howa fmin this market struchure would transition trom the short run to the long run? O The supemomal profits eamed by Warwick Inc in the short run will attract new firma into the market. This wil shit the market supply curve to the right, which will reduce the market price and the price faced by Warwick ine. The price wil keep falling until Average Revenue equals Average Cost and only normal profits are made. O The supermormal profits eamed by Warwick Inc. in the short run will attract new firms into he martet. This wil shit Warwick ine. demand curve to the left and t wit continue to shit left until Average Revenue equals Average Cost and only normal profits are made O The supemomal profits eamed by Wanwick Inc. in the short run will lead to the market demand aurve shifing to the right, which will raise the price fims can sell at and ts wil atract now frms into the market.…
A monopolistically competitive firm has a total cost curve represented by TC = 250+ 3Q + Q² and a marginal cost represented by MC = 3 + 2Q. The firm faces the demand curve P = 99 - 2Q. What do we expect to happen in the long run? O Firms will exit the industry, but if this firm remains its profits will increase. O The firm will earn an economic profit in the long run. O Additional firms will enter the industry and this firm's profit will decrease. O This firm will sell its product at marginal cost. MacBook A esc 800 F1 F2 F3 F4 2$ 4 W R T Y ock G %24 2